Local governments vie for control in Nevada’s new medical marijuana industry

The stakes are growing for Nevada’s prospective medical marijuana entrepreneurs, with new restrictions being added to the maze of regulations already governing the industry in Clark County.

Even as medical marijuana patients celebrated decisions from the city of Las Vegas and Clark County last week anticipating dispensaries in their respective jurisdictions, applicants now face a more politicized selection process. Elected officials are taking on a key role in choosing which businesses will receive the limited number of coveted dispensary licenses. Henderson and North Las Vegas, meanwhile, are crafting their positions behind the scenes. Henderson has banned medical marijuana establishments until July, and the North Las Vegas City Council has yet to publicly discuss the issue.

The split among local governments speaks to the still-controversial nature of medical marijuana despite it being legalized by voters in a 2000 constitutional amendment.

But the potential economic development — dispensaries, cultivation and labs authorized by the Legislature in 2013 — has warmed most politicians to the idea. Now the debate has shifted to ensuring a tightly monitored, safely operated industry with minimal impacts on residents.

“It’s important for us to have as much control over this as possible and not cede it to the state,” commissioner Mary Beth Scow said at a Clark County Commission meeting last week. “Do it by (special) use permit so it’s on a case-by-case basis so we’re seeing exactly where these are.”

Clark County is leading the way among local governments. Its business license department plans to introduce an ordinance March 5 laying out zoning and licensing regulations for dispensaries and other medical marijuana facilities.

Las Vegas has requested work on a similar city-specific ordinance. Although some council members are skeptical about medical marijuana, in part because of the drug’s continued illegality at the federal level, the thought of losing the city’s allotment of up to 10 dispensary licenses to more receptive parts of the valley was enough to push them to action last week.

“There are other localities that will take these and use them,” councilman Steve Ross said Wednesday. “I still think we as a city need to be in control of our destiny. ... This is a local government issue.”

The county commission plans to authorize only dispensaries that have a board-approved special use permit, meaning even applicants who meet all of the law’s myriad requirements and have retained legal counsel to help craft applications for a state dispensary license may be at the mercy of the commission’s discretion.

County leaders hope to have their system in place by the summer when the state Department of Health and Human Services, the chief overseer of the industry, is expected to open a 10-day window for accepting medical marijuana applications.

If the county has its system in place by then, it could submit to the state a list of preferred candidates, giving those selected a significant advantage in the rest of the application process.

That could create a conflict because the state accepts and ranks applications, but even the highest-ranked applicant might be unable to open a dispensary if the applicant lacks a county special use permit. The state would still have control over inspections and would regulate the industry.

“The local governments always have a certain level of authority that we recognize,” said Marla McDade Williams, deputy administrator for the state’s health division. “That’s just the nature of the beast.”

McDade Williams and other lobbyists have compared the medical marijuana licensing process to the state’s method of approving gaming and liquor licenses, which have local and state components.

The evolving regulatory process will likely put commissioners in the crosshairs of lobbyists and attorneys representing the dozens of applicants seeking one of the 10 initial dispensary licenses expected to be granted for the unincorporated county.

Commissioners have been deluged by local and out-of-state interests vying for a spot in what’s expected to be a lucrative industry.

But for now, potential applicants can only wring their hands and watch as local governments craft regulations.

“I guess the rubber will hit the road when the state sends somebody to the county who hasn’t been approved by the county,” said Sen. Tick Segerblom, D-Las Vegas, the sponsor of the medical marijuana law. “If the county rejects that person and they go to court, what does the county do?”